"We are elated to bring Mark back to the Padres," said Padres GM Josh Byrnes. "His versatility and leadership will be invaluable for our club."
The 35-year-old hit .270 with three home runs, 13 doubles and 31 RBI in 104 appearances in his lone season with the NL Central-champion Milwaukee Brewers.
Kotsay played in San Diego from 2001-03, batting .283 with a .355 on-base percentage, 34 homers, 12 triples, 84 doubles and 157 runs batted in over 400 games.
A former first-round pick of the Florida Marlins in 1996, Kotsay has compiled a .278 average, 124 homers, 343 doubles, 48 triples, 773 runs scored and 694 RBI in 1,728 games with the Marlins, Padres, A's, Braves, Red Sox, White Sox and Brewers.